Two weeks after the launch of the EU’s CO2 tax CBAM, the European Commission appears to be having second thoughts. Under heavy pressure from EU agriculture ministers, Commissioners Hansen, Várhelyi, and Maroš Šefčovič presented plans for exemptions for European farmers last Friday, together with Cypriot Minister of Agriculture Maria Panayiotou.
That a central industrial and climate policy instrument is effectively being called into question almost immediately after its entry into force is remarkable-and casts a harsh light on the lack of preparation and internal contradictions in Brussels policymaking.
To justify possible relief measures, the Commission points to fertiliser prices having allegedly risen by almost 60% since 2020. That it deliberately avoids using the official base year 2021-relative to which prices today are nearly unchanged-is more than a statistical detail.
It illustrates how selectively figures are being used by the Commission to support politically desirable narratives. The fact that 2020 had previously been skipped by the Commission’s own statisticians due to its limited explanatory value makes this approach even more questionable.
Commissioner Šefčovič stated that such price increases are neither acceptable nor sustainable. The consequence: the Commission intends to propose lowering MFN tariffs on fertilisers and suspending the CBAM levy for these products.
By comparison, MFN tariffs on fertilisers currently amount to only 5.5 to 6.5%, and CBAM-related additional costs range-depending on origin-between EUR 0 and EUR 40 per tonne.
For steel products, by contrast, CBAM costs in some cases exceed EUR 700 per tonne of hot rolled coil – an price increase of more than 100%. Nevertheless, the Commission continues to pursue its course here without deviation.
The situation appears particularly contradictory in light of the simultaneous announcement that MFN tariffs on fertilisers are to be effectively reduced to zero, while tariffs on steel products are set to rise from previously 0% to as much as 50%.
This is occurring despite steel prices still being more than 30% above their 2020 level. Evidently, very different standards apply to different sectors-depending on how loudly political opposition is voiced.
The Commission is thus increasingly finding itself in a self-inflicted dilemma. As recently as December 2025, CBAM-related burdens for companies and consumers were significantly increased, despite better knowledge. At the same time, Brussels is planning further cost increases: higher steel tariffs, sharply reduced import quotas, the extension of CBAM to downstream products from 2028 onward, and the possible inclusion of steel derivatives.
A coherent overall industrial or climate policy strategy is difficult to discern.
The current proposals demonstrate one thing above all: loud protest has an effect. The well-known risks of extreme cost increases resulting from CBAM, as well as errors in regulations and default values, were documented before the measure was introduced. In Brussels, however, these warnings went largely unheard.
Now the Commission is rowing back selectively-but exclusively in favour of agriculture.
All other sectors are expected to continue swallowing the “toxic CBAM pill”. This is not only manifestly unfair, but also reveals a significant loss of touch with reality. The argumentation coming from Commissioner Šefčovič appears particularly paradoxical: while a 17% increase in fertiliser prices is deemed unacceptable, cost increases of more than 200% for steel due to CBAM and tariffs seem to be considered politically acceptable.
This discrepancy suggests less a commitment to sustainability than a familiar pattern of political activism without a robust underlying concept.
